TikTok’s dream of becoming a shopping destination appears to be taking a major step forward: On Thursday, reports began circulating that ByteDance’s social video app is testing e-commerce features in Europe with a select group of streetwear brands.
One is apparently Hype, according to Bloomberg, which confirmed the test with a company representative. Now this test partner and perhaps others are reportedly set to operate their own in-app stores. Unlike other social commerce services — most notably Facebook and Instagram Shops — TikTok is not expected to deal with the actual transactions, but leave that to the merchants themselves.
TikTok confirmed to WWD that it’s running a test in the U.K., as well as Southeast Asia, as some reports had previously noted, but the company declined to offer any details on the initiative. More broadly, a spokeswoman explained that “TikTok has been testing and learning with e-commerce offerings and partnerships” and the platform is in a constant state of exploration.
“We’re excited to experiment with new commerce opportunities that enable people to discover and engage with what they love,” she added.
The expanded tests represent significant forward momentum for TikTok’s retail ambitions, and may even potentially signal an impending launch. That would put it in the crosshairs of Facebook’s sprawling empire, which has claimed its own stake in social commerce.
But TikTok is no David to Facebook’s Goliath. While it’s just five years old, and often likes to describe itself as a scrappy start-up, it’s actually owned by a major tech giant worth more than one Coca-Cola or five Twitters. By the math, ByteDance’s $250 billion valuation puts it in the same league as Facebook, with $280 billion.
The Beijing-based company owns more than 20 apps, including highly popular platforms like Douyin. TikTok’s kin, both spiritually and literally, the China-based short video app pulled in $26 billion through e-commerce over its first year. In January 2021 alone, it clocked in with $128 million.
ByteDance cofounder Zhang Yiming reportedly outlined his vision to employees in December, telling them that the combination of livestreaming, short videos and e-commerce would pack even more punch abroad.
There’s certainly less stopping the company at this point, now that the Trump administration is no longer threatening the app’s ability to operate in the U.S. Meanwhile, the Biden White House remains undecided about whether it wants to resume the predecessor’s battle against the app developer.
Now, for TikTok, all roads seem to lead to e-commerce. The developer, which launched TikTok for Business last year, has made no secret of its interest in retail, but its efforts were primarily rooted in two partnerships — one with Walmart on shoppable livestreams and another with Canadian mega-retail platform Shopify, which allowed merchants to connect with TikTok users through their online dashboards. Neither really amounted to actual shopping within the app.
TikTok has also been exploring affiliate product linking for its creator community, with efforts like shoppable tags, and ways to facilitate discovery through catalogs. For instance, its Collection Ads offering allows brands to tie product catalogue listings to branded videos, so people can find the items they see in the clips.
Certainly advertising and product discovery has been critical for the platform so far. But, like Facebook and Instagram, it may see commerce as its future. And that means turning TikTok into more than a traffic referrer to other sites. The network itself would have to become the destination.
And now, it may have just taken its first concrete step toward that.